Oppenheimer (NYSE:OPY) and Moelis & Company (NYSE:MC) Critical Review

Moelis & Company (NYSE:MC) and Oppenheimer (NYSE:OPY) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitability, institutional ownership and analyst recommendations.

Dividends

Moelis & Company pays an annual dividend of $2.60 per share and has a dividend yield of 3.8%. Oppenheimer pays an annual dividend of $0.72 per share and has a dividend yield of 1.1%. Moelis & Company pays out 87.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Oppenheimer pays out 9.7% of its earnings in the form of a dividend. Moelis & Company has raised its dividend for 1 consecutive years and Oppenheimer has raised its dividend for 1 consecutive years.

Valuation & Earnings

This table compares Moelis & Company and Oppenheimer”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Moelis & Company	$1.19 billion	4.43	$136.02 million	$2.99	22.60
Oppenheimer	$1.43 billion	0.50	$71.56 million	$7.45	9.17

Moelis & Company has higher earnings, but lower revenue than Oppenheimer. Oppenheimer is trading at a lower price-to-earnings ratio than Moelis & Company, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Moelis & Company and Oppenheimer’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Moelis & Company	15.98%	45.62%	18.93%
Oppenheimer	5.50%	9.58%	2.34%

Institutional & Insider Ownership

91.5% of Moelis & Company shares are held by institutional investors. Comparatively, 32.3% of Oppenheimer shares are held by institutional investors. 6.4% of Moelis & Company shares are held by insiders. Comparatively, 34.3% of Oppenheimer shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Moelis & Company and Oppenheimer, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Moelis & Company	0	7	3	1	2.45
Oppenheimer	0	0	1	0	3.00

Moelis & Company presently has a consensus price target of $71.57, suggesting a potential upside of 5.91%. Given Moelis & Company’s higher probable upside, research analysts plainly believe Moelis & Company is more favorable than Oppenheimer.

Volatility & Risk

Moelis & Company has a beta of 1.9, suggesting that its stock price is 90% more volatile than the S&P 500. Comparatively, Oppenheimer has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.

Summary

Moelis & Company beats Oppenheimer on 12 of the 17 factors compared between the two stocks.

About Moelis & Company

Moelis & Co. operates as a holding company. It engages in the provision of financial advisory, capital raising and asset management services to a client base including corporations, governments, sovereign wealth funds and financial sponsors. The firm focuses on clients including large public multinational corporations, middle market private companies, financial sponsors, entrepreneurs and governments. The company was founded by Kenneth David Moelis, Navid Mahmoodzadegan, Jeffrey Raich and Elizabeth Ann Crain in July 2007 and is headquartered in New York, NY.

About Oppenheimer

Oppenheimer Holdings Inc. operates as a middle-market investment bank and full-service broker-dealer in the Americas, Europe, the Middle East, and Asia. The company provides brokerage services covering corporate equity and debt securities, money market instruments, exchange-traded options and futures contracts, municipal bonds, mutual funds, exchange-traded funds, and unit investment trusts; financial and wealth planning services; and margin lending services. It offers asset management services, including separately managed accounts, mutual fund managed accounts, discretionary portfolio management programs, non-discretionary investment advisory and consultation services, alternative investments, portfolio enhancement programs, and institutional taxable fixed income portfolio management strategies and solutions, as well as taxable and non-taxable fixed income portfolios and strategies. In addition, the company offers investment banking services, such as strategic advisory services and capital markets products; merger and acquisition, equities capital market, debt capital market, debt advisory and restructuring, and fund placement services; and institutional equity sales and trading, equity research, equity derivatives and index options, convertible bonds, event driven sales and trading, and portfolio and electronic trading. Further, it provides institutional fixed income sales and trading, fixed income research, public finance, and municipal trading services; and proprietary trading and investment activities. Additionally, the company offers underwriting, market-making, trust, and discount services, as well as a cloud-based financial market. It serves high-net-worth individuals and families, corporate executives, public and private businesses, institutions and corporations, governments, financial sponsors, and domestic and international investors. Oppenheimer Holdings Inc. was founded in 1881 and is headquartered in New York, New York.